5 Things You Need to Know About the Oakland Development Boom
From green building to how to use what little buildable space is available, Oakland's top commercial real estate players are all trying to maximize the critical mass taking place in the city. Here's what you should know:
1) Tenant Improvements Are Dominating
Turner Construction VP Dan Wheeler says he sees a lot of tenant improvements in the market right now. His own offices moved into a $1M historical retrofit in Oakland's landmark Rotunda Building at the beginning of this year. He sees the move as reinvesting in Oakland.
One thing limiting new construction in Oakland is rents, Dan told attendees at Bisnow's Oakland Construction & Development: Red Hot Real Estate! event this week. Since it costs about the same to build a high-rise tower in Oakland as it does in San Francisco, the viability is being placed on the rents, which are about $60 to $80/SF in San Francisco and about $30/SF in Oakland. The good news, he said, is a lot of new infrastructure is about done, opening up new opportunities in the city.
2) Alternative Transportation
KTGY principal David Senden says Oakland is an easy place to go by bike "if you're a little bit daring." About half of his office commutes by some means other than car. He's seeing more easy bike storage as well as places to work on bicycles. Sometimes a bike mechanic shop is the perfect fit when the city would like a storefront, because it serves both the residents and the community, he said.
After having KTGY's offices in Jack London Square for 10 years, David said it's exciting to be working on more projects in the city—some within walking distance of his offices.
3) Sustainability Rules
Sandis VP Jeff Setera (center, speaking with Kevin Stein of BKF Engineers and panel moderator Matthew Zumstein of Ropers, Majeski, Kohn & Bentley) says in the past three years, the priority has become very focused on water usage. That includes how best to use stormwater for irrigation and finding ways to store it in the rainy season, usually in cisterns.
The challenge, Jeff said, is finding space for those cisterns in infill sites, where they usually require giving up a little bit of building space, since there isn't much open ground.
4) Sports Matter
To continue to be a draw, Oakland needs to retain its sports teams, Dan said, mentioning the Raiders and the A's. "I think there is a viable option, but it needs everybody in the room," he said.
Mayor Libby Schaaf (here with moderator Robert Ogilvie) also believes there's an Oakland solution for the Raiders even as they look at a new stadium in Carson. The city won't publicly subsidize stadium construction, she said, but it can find ways to help get it done.
5) City Transformation
Jeff said Oakland's downtown needs more nightlife after normal work hours. Venues such as the Fox Theater help, but he'd like to see more businesses, such as restaurants.
New projects have to keep a sense of what makes Oakland unique even as they seek to improve it. "There's a fine line between keeping Oakland its gritty, cool, urban self and scrubbing some of that out a little bit," David said.